Bangkok. Thailand's central bank left its benchmark interest rate unchanged on Wednesday (14/02), near record lows, saying it expects inflation to stay largely subdued even as Southeast Asia's second-largest economy gains further momentum.

The Bank of Thailand's (BOT) Monetary Policy Committee unanimously voted to keep the one-day repurchase rate at 1.50 percent, as expected by all 22 economists in a Reuters poll. The policy rate has been kept unchanged since a 25-basis-point cut in April 2015.

"The Committee viewed that the current accommodative monetary policy stance remained conducive to the continuation of economic growth and should foster the return of headline inflation to target, although the process could take some time," the BOT said in a statement.

The central bank said the economic outlook had improved on the back of strong global demand for its exports, but recovering domestic demand and inflation developments should be monitored.

It noted risks to the growth outlook from US economic and foreign trade policies, and geopolitical uncertainties.

Analysts mostly see no need for the central bank to adjust policy this year.

"Looking ahead, we see little impetus for the BOT to adjust its current monetary policy stance. With the economy in good health, there is no need for policy loosening," Krystal Tan, economist of Capital Economics, said in a research note.

The central bank has forecast economic growth of 3.9 percent for both this year and in 2017, but a BOT official recently said 2017 growth could be 4 percent. The state planning agency is due to announce official GDP data on Feb. 19.

The economy expanded 3.2 percent in 2016.

Muted Price Pressures

The central bank said headline inflation, at 0.68 percent in January, was expected to return to its 1-4 percent target range in the second quarter of this year.

Charnon Boonnuch, economist of Tisco Securities, said "inflation has been disappointing and reflects how sluggish domestic demand is. I see no rate hike in 2018."

Analysts have said the next rate move should be an increase, but that will likely not happen until the economy has sustained growth and is pressured to act in step with tightening moves by other central banks.

The BOT last raised its policy rate in August 2011, a quarter-point increase to 3.50 percent.

The committee said the baht would likely remain volatile.

The central bank is worried about the rapid rise in the baht and has stepped in to slow its ascent. It says it is ready to intervene if the currency moves too fast.

The baht traded at 31.41 per dollar at 0737 GMT, hovering near four-year highs against the greenback. It has appreciated by 3.7 percent against the dollar so far this year after gaining 9 percent in 2017.